Tuesday, June 27, 2006

Does your insurance cover "acts of God?"

I've often heard about insurance companies that weasel out of paying a claim on account of the damage being caused by an "act of God"--apparently any sort of unpredictable (at least by the insurance company) event. This, however, gives new meaning to the term:
Insurers have withdrawn the cover on their virginity taken out by three sisters in the event of the second coming of Christ.
The cover was meant to pay for the cost of bringing up Christ if one of them had a virgin birth.


Blogger King Aardvark said...

The act of God stuff has always pissed me off. I hope that somewhere in the policy is an article outlining that "AoG" is just a generic term for an unpredictably freak natural event. As an athiest, I find the terminology insulting. Theists should also be insulted: Insurance companies are implying that God wants to screw them over by destroying their house and not getting any insurance money.

Of course, insurance companies are the work of the devil ;-)

9:57 AM  
Blogger Mark said...

What makes it worse, is that in certain cases, the "freak" events are almost certain to happen, although it may not be possible to predict exactly when (like predicting when a 20-year flood will occur).

6:06 PM  
Anonymous Anonymous said...

There is no AoG exclusion in insurance policies, never has been. How that myth got started is beyond me.

4:08 PM  
Blogger Mark said...

I think I first heard about the legal ramifications of "acts of God" when one of my professors explained how property boundaries may or may legally change as a stream alters its course, depending on whether the channel was altered by gradual erosion or sudden erosion (such as by a meander cutoff).

A more recent notable case occurred after a tornado hit Arkansas in 1997. Then governor Mike Huckabee delayed disaster funding because insurance companies declared the disaster an "act of God:"
Senate Bill 491 was so straightforward it ran to only two pages. It sought to protect tornado victims from insurance companies that might cancel policies after they filed claims. “No insurance policy or contract covering damages to property shall be canceled nor the renewal thereof denied solely as a result of claims arising from acts of God,” it read. [Source: Pensito Review]

The Maryland Insurance Administration defines "Act of God" as: natural occurrence beyond human control or influence. Such acts of nature include hurricanes, earthquakes, and floods. (A snow storm is an act of God. Driving in a snow storm is an act of man or woman or teenager.)

In a bit of turnabout, the Indiana Department of Insurance has a standard form for agreements of deposit (for insurance companies that are obliged to deposit assets for one reason or another) wherein the bank shall not be held liable for loss of deposits due to acts of God.

A myth? Not at all. "Act of God" was defined (vaguely) early on in legal matters, specifically for contracts--and insurance policies are spelled out in contracts. Some policies may refer to "act of nature," but there's not difference there.

8:17 AM  

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